Pricing of export products on FCA (FCA - Free Carrier) basis via Air Freight

How to determine the appropriate price for your product based on FCA (FCA - Free Carrier) basis via Air Freight

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FCA (FCA - Free Carrier) basis via Air Freight

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Pricing in exports should be done by considering the costs which are depending upon the delivery terms in your contract with your customer.

For the FCA (FCA - Free Carrier) basis via Air Freight, the following additional costs should be considered in the pricing of your export product.

  • Packing of Goods: (By Seller)
    Costs for securely packaging the products to ensure their protection during transit are the seller's responsibility. However, packaging should comply with the requirements specified in the contract. For instance, packaging for sea freight differs from that needed for air freight. Additionally, if wooden packaging or crates are used, the materials must be fumigated or heat treated according to ISPM-15 standards, along with a valid certificate enclosed alongwith shipping documents. This is to prevent the international transport of diseases and insects that could negatively impact the plants and wildlife of the destination country.
    There are international standards for multi-level packaging based on the type of goods, whether they are consumer goods, corrosion-prone capital equipment, or dangerous goods.
    For example, as a consumer goods supplier, it's not enough to have robust export packing for the outer layer. The intermediate packaging used for boxes traveling from distributors to retail stores, as well as the inner packaging of the actual product, must also comply with the labeling and packaging requirements of the destination country. This includes considerations like child-resistant packaging, language of the labels, statutory warnings, and other regulations.
  • Loading of the Goods in the vehicle: (By Seller)
    Cost of loading the goods onto the vehicle at the factory or source warehouse.
  • Customs Clearance: (By Seller)
    Fees for completing the necessary documentation and procedures to comply with export regulations and obtain clearance from customs authorities.
    • Minimum 3 sets of Commerical Invoice, Packing Lists, Certificate of Origin (endorsed by local Chamber of Commerce) etc are required by most countries, and that lists will vary depending upon your customer's country.
    • A forwarding agent can help you in getting the container sealing, shipping bill and custom clearance done.
  • Inland Transit towards the destination in India: (To be confirmed in the contract if by Seller/Buyer)
    Expenses for transporting goods from the factory, warehouse to the destination in India.
    • Buyer's responsibilities
  • Inland Transport to the port in India: (By Buyer)
  • Indian port handling charges: (By Buyer)
  • Freight charges to destination port: (By Buyer)
  • Transit Insurance: (By Buyer)
  • Destination Port charges: (By Buyer)
  • Destination Customs clearance: (By Buyer)
  • Destination Tariff (Customs Duty): (By Buyer)
  • Inland Transit towards Final Destination: (By Buyer)
  • Unloading charges at Final Destination: (By Buyer)

Even though the information mentioned above can act as a guideline, you should make sure to consult your shipping agent and export consultants before making the quotation of your product or before entering into any contract.

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